China hits back at foreign scrutiny on its excess steel capacity

China should not be singled out in a fight against excess steel capacity that requires stronger global cooperation, Wang Shouwen, a vice commerce minister, said on Saturday.

“When we are talking about overcapacity in the steel sector, China should not be singled out. This is a global issue, this is a cyclical issue,” Wang told the China Development Forum in Beijing.

China is both the world’s biggest steel producer and consumer, and its steel sector has been under particular scrutiny. Chinese mills have been subject to increasing numbers of anti-dumping moves by international rivals amid accusations that they have been selling at less than cost and forcing foreign competitors out of business.

President Donald Trump’s choice for top U.S. trade negotiator on Tuesday pledged an “America First” strategy to enforce U.S. laws and trade deals to stop unfair imports and push China to scrap excess factory capacity.

China has recognized the seriousness of overcapacity problems in some industries and has been trying to deal with the issue, while some other countries have been “just talking and watching”, Wang said without making specific reference to the U.S. comments or elaborating further.

China is facing growing trade frictions with its trade partners, he noted, but he shrugged off criticism about the country’s trade practices. Major economies should tackle overcapacity problems in a concerted manner, he said.

China has announced plans to slash another 50 million tonnes of steel capacity this year, on top of the 65 million tonnes removed last year. Many of the plants closed last year were already idled, however, and output from the still-open plants actually rose 1.2 percent to 808.4 million tonnes.

China will continue to open up its economy to foreign investors and promote globalization, which is facing risks from “populism, conservatism and protectionism”, Wang said.Source: Reuters